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Packaging management costs in the supply chain
Maciej Kubiak Country General Manager
Iwona Nowakowska Supply Chain Director
About Żywiec Zdrój S.A. (Danone Waters)
Danone Group Employment - approx. 570 employees
Coca Cola
5,8%
Polskie Zdroje
8,5%
Nestle Waters
9,7%
Other
43,6%
32,4%
Source: Nielsen, Total Poland+Petrol Stations, 2011, value shares
Żywiec Zdrój S.A. is a leader in the sector of bottled water in Poland
CHEP Office
CHEP Service Centres
Bydgoszcz
Gądki
Kampinos
Radom
Świętochłowice
Warsaw
11 mln Pallets Issued
4,500 Delivery
Points
600 Customers
CHEP is a global leader in pallet pooling services
7 new countries were added to CHEP business in 2011
History of collaboration CHEP - Żywiec Zdrój S.A.
2007
2008 2009
2010 2012
Begin of negotiation
regarding pallet
management
Begin of
Value Chain Analysis
End of analysing
Value Chain
Begin of
cooperation
(800x600)
Begin of
cooperation
(1200x800)
Pallet Management at Żywiec Zdrój S.A. Requirements for pallet entry to producer’s factory
• Beverage production requires high demand for pallets Volume
Seasonality
Production
Quality
• Seasonality in sales causes fluctuation of pallet
demand during the year
• Production cycle requires just-in-time pallet supply
• Limited space for pallets storage
• The use of pallets on automated production lines
requires high-quality carriers
Acceptance
Time
Responsibility
Relation
• Pallet acceptance by customers
• Shortening time of delivery
• Decrease in responsibility for pallet management by
Żywiec Zdrój and cooperating companies
(e.g. Transporters, 3PLs)
• Improvement in business relations with customers
and other business partners
Pallet Management at Żywiec Zdrój S.A. Requirements for pallet entry to retailer’s location
Management of EUR pallets Cost generation at Żywiec Zdrój S.A.
Wholesalers Retailers
Pallet
purchese
Pallet
Acceptance Pallet
losses
Transport
Pallet
Administration
Return
transport
Pallet
Supplier
Distribution
Centre Pallet
Recycling
Increase in
pallet balances
Repairs
Supply Chain
Analysis SWOT Analysis Cost Analysis
Analysis of the
current pallet
management system
Presentation of
strengths and
weaknesses of the
current system
Presentation of
current and
estimated cost of
pallet management
Pallet management cost identification Value Chain Analysis
Analysis of the Value Chain allows to estimate the cost of pallet
management in the company
Pallet management cost identification Value Chain Analysis
Is the number of
pallets shipped
equal to the
number of pallets
received?
Where are the
biggest pallet
losses?
Do we have full
knowledge about
the number of
pallets in the
system?
How much does the
pallet exchange
cost?
Are we sustainable
in pallet
management?
What factors
influence the cost
of pallet
management?
What factors influence the cost of pallet management?
Variable pallet
price
Unstable
fuel prices
Increase in
turnover
/Sales
Increase in
transport
costs
Transport
Responsibilities
concerning
sustainability
Pallet
losses
Cooperation with CHEP allowed Żywiec Zdrój S.A. to improve its supply chain ...
Security
of supply
Consistent
quality
Reduced
cost
Distribution
Centre
Wholesalers Retailers
Improvement of relations with
customers and carriers
Transport
Efficiencies
Acceptance
(lack of complaints)
Minimised
administration
No appointment
for collection
Limited
responsibility
Safety in
manufacturing
Safety in
warehouse
Faster
deliveriy
...and to bring transparency concerning the costs of pallet management
Pallets and the Environment
PEFC and FSC
CHEP has the PEFC and FSC certificate, which
gives Żywiec Zdrój S.A. guarantee, that the use of
wood for the production of pallets generates from
a legal source
5 700 trees...
are saved within 10 years by Żywiec Zdrój S.A. using CHEP pallets
5 tons of CO2...
are saved within 10 years by Żywiec Zdrój S.A using CHEP pallets
Żywiec Zdrój S.A. Social Responsibility in the context of Environmental Protection
Climate footprint reduction (reducing CO2 emissions)
Tree Planting and Education
Revitalization of green areas, support the liquidation of
illegal waste dumps
Organization or Co-organization of educational workshops
and ecological happenings, such as „Waste collection",
"Eco Rally"
Iwona Nowakowska Supply Chain Director
Maciej Kubiak Country General Manager
